Good morning! Here’s what you need to know.
1. The European Union plans to give itself powers to move euro clearing business away from London’s financial sector to the EU after Brexit and adopt a model closer to that operated by the United States, Reuters reported. The draft law would force euro-denominated clearing business to shift from London to the bloc if the volume was deemed by Brussels to be systemically important.
2. Spain’s government faced a vote of no confidence tabled by the far-left Podemos to denounce a series of corruption scandals that have hit Prime Minister Mariano Rajoy’s conservative party. The motion is unlikely to succeed as a majority of lawmakers plan to vote against it or abstain, but it is once again shining the spotlight on the ruling Popular Party, whose reputation has been damaged by graft case after graft case.
3. Three London-based former currency traders facing US charges that they tried to manipulate prices in the world’s largest financial market have agreed not to fight extradition, and will appear at a New York court hearing next month. Rohan Ramchandani, Richard Usher and Chris Ashton, formerly of Citi, JP Morgan Chase and Barclays – dubbed the “Cartel” – were indicted by the Department of Justice in January.
4. Money misappropriated from the Malaysian state fund was used to partly finance the $US2.2 billion acquisition of Coastal Energy in 2014. Proceeds from the Coastal Energy deal were then used to buy a property in London’s glitzy Mayfair district.
5. Finland’s nationalist Finns Party has split into two groups after choosing hardline anti-immigrant politicians as its leaders, paving the way for Prime Minister Juha Sipila to include the moderates in a new coalition government. Sipila had said he would break up his three-party center-right coalition as he wanted to eject the Finns Party.
6. British junior finance minister Lucy Neville-Rolfe, who was responsible for liaising with the financial services industry over Brexit, said on Tuesday that she had left the government. Neville-Rolfe became a Conservative member of Britain’s upper house of parliament in October 2013 after a career at retailer Tesco and earlier in Britain’s civil service.
7. South Africa’s competition watchdog has launched an investigation into three pharmaceutical companies suspected of charging too much for cancer medicines. The Competition Commission said it will investigate Aspen Pharmacare, Africa’s biggest generic drug maker, US company Pfizer and Swiss-based Roche Holding.
8. Bond investor Bill Gross warned that investors should reduce their risk appetite, given the US growth rate is stunted by secular forces “which monetary and even future fiscal policies seem unable to reverse.” Gross of Janus Henderson said: “Strategies involving risk reduction should ultimately outperform ‘faux’ surefire winners generated by central bank printing of money.
9. OPEC said a rebalancing of the oil market was under way at a “slower pace” and reported that its own output in May jumped due to gains in nations exempt from a pact to reduce supply. OPEC said its output rose by 336,000 barrels per day led by a rebound in Nigeria and Libya, which were exempted from supply cuts because unrest and conflict had curbed their output.
10. Uber CEO Travis Kalanick will take a leave of absence from the company to “work on myself” and to deal with a recent family tragedy, according to an email he sent to the company. When he returns to the ride-hailing giant, Kalanick will be stripped of some duties, and Uber’s board will appoint an independent chair to “limit his influence,” Bloomberg reported.
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